Author: Dan Swanson

This is the story of how a man who had a problem, solved it for himself, then asked the simple question, “How many others would like this same solution for this problem?” As a result of answering this question, found his own Acres of Diamonds.

Here’s how I heard about this man.

About 15 years ago a friend of mine called me up with more enthusiasm than normal saying “I’ve got someone you’ve got to meet.”

I said, “Why?”

He said, “Trust me.”

He gave me the name and phone number of a woman and just said, “Call her.”

Being a shy personality, at the time, this was way beyond my comfort zone. But because he was my friend and I could tell he thought I should talk to this person. I called. Boy was I glad.

I called her up and explained why I was calling and she said, “I know exactly why your friend asked you to call.”

She then went on to describe an incident with her parents and how one major irritation during an evening’s event lead to a great business, their own Acres of Diamonds.

Her parents were both professors and two different universities. They would frequently have special events where they would accompany each other such as banquets or award ceremonies. These were often black-tie events and this one was no exception.

As her dad got ready for the special event at the university, he went to put on his tuxedo only to discover he hadn’t been sent to be cleaned since he had last worn it and it had lots of lint that showed on the black tux.

He almost cancelled but then came up with an idea. He got an empty toilet paper roll and wrapped masking tape around it with the sticky part out. He then rolled the sticky combination up and down the sleeves, the front, the back of the jacket and also both the front and back of the pants. He was able to remove all of the lint.

He tossed his invention aside and went to the event, which went along just fine.

When he returned home that evening he saw his invention and wondered if others might be interested in an emergency delinting device like his. He concluded they would.

He started making these in the evenings in his basement and selling them through local stores. As the business grew he would have the neighbors come over to his basement after work and they would help assemble these as well.

He got to the point of making so much money he decided to quit his job as a professor. Everyone, including his parents, thought he was crazy.

Within a few years the business grew to over $15 million per year in revenues.

His wife’s name was Helen and their last name was MacKay. So he named the company Helmac.

You’ve seen the sticky tape with a handle on it. Take a look at the next one you see, it will probably be made by Helmac.

So how can you take this example and apply it to your situation?

1. Make a list of problems you encounter every day. Whether the problem is related to taking a shower in the morning, walking the dog, finding a parking spot, getting stuck in traffic on your way to the gym or taking out the garbage; write it down.

2. Add to the list every time you have a problem yourself or hear someone complaining about a problem.

3. Once a month, go through the list and pick one or two of these ideas and brainstorm ways of solving the problem. If you can think of a low cost solution to a problem that many other people would want to purchase, then you might be onto a great product or service idea.

Your Acres of Diamonds may not be polished precious gems sitting in your backyard. They may be lint on your tuxedo that needs to be removed at the last minute.

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Anyone who has ever used a typewriter has experienced the frustration of hitting the wrong key. Depending on which year you made this mistake, you had very few choices as to what you could do after making the mistake.

For most of the typewriter’s existence, if it was an important piece of paper you were typing you had no choice but to throw away the one with the mistake and start over again.

This was very time-consuming. For some, it was impossible to actually type a whole page worth of characters and not make a mistake. This meant many people couldn’t use the typewriter at least not until someone could solve this problem.

A Valuable Solution

In 1954, an executive secretary, Bette Graham, decided that there was a better way. Her mother was an artist and Bette decided to use tempura paint to cover up her typing mistakes.

Soon, others in the office saw what she was doing and wanted some of this magical liquid Bette called “Mistake Out.”

The demand for it grew and she started making it at home. Her son and his friends would bottle it up.

In 1958 an office magazine ran an article about “Liquid Paper” which resulted in over 500 orders. This grew to over 5,000 bottles per week by 1962.

By 1975 she moved the headquarters of Liquid Paper from San Antonio to Dallas. Three years later she sold her company, Liquid Paper, to Gillette for $48 million.

Bette’s Acres of Diamonds was sitting in her mom’s painting supplies. She turned an irritation with typing mistakes into a multi-million dollar fortune.

Each of these solutions is someone else’s Acres of Diamonds. There can be more than one successful solution to a problem.

Finding Your Own Acres of Diamonds

Ask yourself a series of questions:

What problems are you facing that others face?

Which of those problems would people be willing to pay money for a solution?

What possible solutions are there for that problem?

Which solution seems like the right one for you to pursue first?

What are your next action steps?

You don’t have to have a degree, a special background, previous experience or certification to come up with a great solution to a persistent problem. You just have to decide you want to find a solution and take action. The power of intention and persistence will yield great rewards.

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Prior to his invention, a farmer could harvest one-half acre per day using a hand scythe.

Using his reaper, a farmer, and a helper could harvest 12 acres per day. That’s a 12-fold improvement in productivity, a revolution for farming.

The problem was farmers stayed away by the droves. This wonderful invention was too expensive to purchase.

His early machines sold for around $100. The average person was only making five cents per hour or about $100 per year. At that time over 80% of the population of the US population lived on farms and rural communities.

With the use of installment payments, the sale of his invention took off.

Within 26 years he had reached his goal of becoming a millionaire.

Why do I call installment payments an Acre of Diamonds?

Because it can change your business or someone else’s and you can profit from it.

How many $49,000 Chevy Suburbans would be sold today if it weren’t for installment payments? The same thing is true of homes, high-end electronics, and many new things thanks to credit cards which allow you to buy virtually anything using “installment” payments.

How does this help you find your Acres of Diamonds?

Do you have a product or service that is so expensive, you should think about offering installment payments?

I’ve attended 18 marketing seminars over the last 5 years. Many were as high $25,000 per person. I talked to one of the gurus and he said he tested his success with and without installments. He landed three times as many customers by offering to break down the price into 3 or 6 payments.

Why offer installments when clients can pay with credit cards?

Because many of those credit cards are maxed out.

There are certainly other things to consider when offering installment payments, like what if they don’t pay? What if they are slow to pay? What if their check bounces? All of these are important questions but remember you can absorb a lot of bounced payments with three times as many sales.

What other policies, procedures, marketing techniques, payment plans, etc. can you adopt from other industries and apply them to your own? Not that every one of them needs to be tried but look around with the ideas that surround you every day and see which of those converts your current business or ideas into Acres of Diamonds.

About the Author

Dan Swanson is an Internet marketing consultant, who systematically increases qualified traffic and improves conversions of visitors to customers for client’s websites. For more information on his Internet marketing consulting services visit http://www.iq2.com.

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Quite a few years ago, I got a consulting assignment to evaluate the software and hardware development team for a high tech division of a large corporation.

This division had spent quite a few dollars and lots of time developing a new fax board for PCs.

This was at a time when there were only a few other competitors in this market.

After interviewing all of the engineers and software programmers, I gave them my summary.

They were four months away from delivering the product at the earliest. A competitor was producing a board with identical features, selling it in Byte magazine for $199. In contrast, the bill of material (raw parts cost without assembly) for my client was $249.

I recommended they stop product development, let the staff go, stop their losses.

In the process of the above research I had discovered how they had made their money previously. They were involved in satellite broadcast of information. It was clear that the broadcast business was still viable, they had just grown tired of it and wanted to get into the lucrative PC add-on market.

I recommended they get back into that market.

Within a year they were making more than $5 million and were a leader in the Acres of Diamonds market they had previously abandoned.

Questions to ask yourself:

What business ideas or product ideas have you tried in the past that either failed or decided not to pursue?

Is now a better time to try those out again?

Did you have some key element missing back then that you can now supply?

Is there a new technology, new marketing strategy, a new strategic alliance that you could add to your old idea and make it work today?

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One of my friends, Jim Beckett, was an avid baseball card collector when he was a kid. He was one of the few kids in America whose mom didn’t throw away his collection when he grew up.

Even when he became an expert witness, he still loved going to baseball card stores and shows.

One of the things that irritated him was to periodically see a dealer taking an advantage of a kid who had a valuable card but was given very little for it.

This prompted him to create a newsletter that he would give away for free to anyone who wanted it, giving prices of the most commonly traded cards. He would set the price, just collect data on what cards were being sold for.

After two years of doing this for free, a friend of his suggested he expand that into a magazine and start charging for it. He started Beckett Publications.

The business grew like wildfire becoming a multi-million dollar company in a short period of time.

Eventually the business grew to over 150 employees and captured 90% of the market share.

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Years ago I met a man named Ray Miller. He told me a story of his first business venture.

Ray was a salesman for a copier company.

One day he took a long plastic tube, warmed it in the oven and bent it around a coke bottle. When it cooled down it became a straw to use when drinking water out of a glass. He gave it to his second grade son. The son took it to school the next day for show and tell.

That afternoon, his son came home with a little note pinned to his shirt. The teacher loved the straw so much she asked if the father could make 30 of them for class next week, they were going to have a party and she tought it would be fun for the whole class to have.

The next week after the party he started getting calls from the parents. They were asking for 10 or 20 or 30 each because they were going to have parties, bar mitzvahs or birthday parties.

He decided at this point in time he was onto an idea.

So he went to a regional grocer and asked if he could produce these for $0.99 each, how many would they be interested in buying. They order 5,000 dozen of them.

He then went to Southland Corporation (Parent company of Seven-Eleven) and asked the same question. They order 50,000 of them.

He calculated he would need $30,000 in capital to fulfill the orders.

He approached a group of doctors that invested in projects. They said if he could find someone to put up $15,000 they would put up $15,000. He then heard of a lawyer that invested. He approached the attorney who after hearing the story, wrote out a check for $15,000. He then took that check back over to the doctors, showed them and they wrote out a check for the other $15,000.

From the time he made the first silly straw until he had the $30,000 in his pocket was 2 weeks.

The company grew to over $14 million in revenues in just a little over a year.

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Several years ago I was reading a fascinating story of a person who seemed like they had lost their mind. They had one of those vacant pieces of land that people started dumping their old tires on.

Instead of the ordinary “no trespassing, violators will be prosecuted” and “Private property, keep off” signs that you see on empty land, he actually encouraged people to dump their old tires on his property.

This went on for years.

One day to everyone’s surprise, the man rented some trucks to haul off the “eyesore” tires.

If I recall the value these had become to retreaders looking to recycle tires was in the millions of dollars.

So by providing a solution, “dumping place for old tires” he became very wealthy.

Like the old saying, one man’s junk is another man’s treasure, really proved true in this case.

We often don’t think through the value of many things that we are surrounded by. We accept things as normal and of little value when we see it over and over. Yet the wealthy person looks at the same thing the rest of us look at and sees the value, the opportunity.

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Quite a few years ago I helped a company go from $0 in revenues to over $1 million per day in revenues.

One of the things that made us successful was an accidental discovery of Acres of Diamonds.

As our call center business grew we needed more than eight call center workstations to handle the traffic. In order to grow we had to change from our NearSpace based equipment to a Nortel DMS 250 switch. We were excited about the added capabilities but did not like the $40,000 per workstation price, Nortel charged for each call center workstation, since we hoped to have hundreds of them in the future.

We looked around for other solutions but the only other supplier could not meet all of our programming demands.

So I proposed creating the system using PCs…this was at a time when a PC cost nearly $4,000 with a 10 MB hard drive and 640K of memory…seems outrageous in today’s environment.

I got approval to create the new workstation.

I designed the new features and had a programmer create the code. We had replicated the functionality of the $40,000 workstation for a per unit cost of $3,500 each. Because of the new features we were able to add we increased productivity over a three month period over 400% so we needed only 25% as many call center agents as those using the Nortel version.

This gave us several strategic advantages. Our labor costs were only 25% of what others needed and we saved over $34,000 per workstation.

To show the impact this had on our bottom line, within 2 years we had grown so large, we only needed 1,500 operators instead of 6,000…saving us over $90 million per year in labor.

Since we needed nearly 1,000 workstations within 2 years, we saved over $34 million in capital on workstations alone, and another $48 million in switches required to connect the 6,000 operators had we needed that many.

So what started out as a problem, we couldn’t find a call center solution to meet our needs, turned into an Acres of Diamonds for us. The total development costs required to save the $150 million plus dollars was less than $500,000.

What was so ironic is that the call center software and hardware were so successful, Nortel licensed the them from us and sold over $250 million of call center workstations based on our design.

What problem have you been tolerating that currently only has a partially successful solution? If you created a custom solution you could save your company a lot of money and labor? Go for it.

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